SummaryThe issue in this case was
whether the carrier, APL Co, was under a duty of care to release goods only on
production of the original bill of lading, even though the bill in question was
a non-transferable ("straight") bill. The High Court of Singapore held
that it was under such a duty, and also clarified the distinction between
straight bills and sea waybills.

DMC Category Rating: Developed

This case note is based on an Article in the August 2002 Edition
of the ‘Bulletin’, published by the Marine and Insurance teams at the
international firm of lawyers,

Facts
Mr Voss arranged for the shipment of a Mercedes Benz car
from Germany to Seohwan Trading Co Limited of Korea at a c & f price of
DM108,600. The carriers, APL Co, issued a bill of lading showing the shipper as
Mr Voss. In the box entitled "Consignee", the printed words stated:
"(Name and Full Address/Non-Negotiable unless Consigned to Order) (Unless
provided otherwise a consignment "To Order" means to Order of
Shipper"). Typed in to this box was Seohwan's name and address, nothing
else.

On arrival at port, APL handed the car over to a man claiming to
be from Seohwan who produced copies of an invoice and a cable from a bank
purportedly showing payment of the balance of the price. That money was never
received by Mr. Voss.

Mr Voss sued APL for breach of contract, breach of its duty as
bailee and/or for failing to exercise due care with the cargo because they
delivered the car without requiring presentation of the original bill of lading.

APL, however, argued that, in the case of straight bills, the
carrier is entitled to deliver even if no original bill of lading is produced by
the consignee. They drew an analogy between a straight bill of lading and a sea
waybill (the maritime equivalent of a document usually used in the context of
land and air carriage). A sea waybill operates as a receipt for goods received
and evidences a contract of carriage, but is never a negotiable instrument.
Consequently, it is usually used on short sea routes where neither the shipper
nor the cargo receiver needs to pledge shipping documents in order to raise
finance. The receiver can take delivery merely by establishing his identity and
does not have to produce the original sea waybill, and, since a sea waybill is
not a bill of lading, it is not subject to the Hague Rules or the Hague-Visby
Rules.

Judgment
The judge found in favour of Mr Voss. She found it to be a
firmly established principle of law that, in a contract for the carriage of
goods by sea, delivery of the cargo is to be made at the discharge port by the
carrier to the consignee only upon the production by the consignee of the
original bill of lading. This principle is implied into all contracts for the
carriage of goods by sea. Numerous authorities can be cited in support of this,
none of which made any distinction between bills "to order" and
straight bills (see, for instance, Sze Hai Tong Bank v Rambler Cycle Co [1959]
MJL 200, Barclays Bank v Customs & Excise Comrs [1963] 1 Lloyd's Rep 81, and
The Houda [1994] 2 Lloyd's Rep 541).

As for APL's analogy with sea waybills, the judge was not
satisfied that there was any real or convincing authority for the proposition
that straight bills and sea waybills are the same. Whilst it is true that Carver
on Bills of Lading proposes that, since neither can be documents of title, the
carrier in either case is entitled to deliver to the named consignee without
production of the original bill, the judge in the case cited in support (The
Brij [2001] 1 Lloyd's Rep 431) relied solely on a passage in the fifth edition
of Benjamin on Sale of Goods and appeared to have treated the matter as
uncontentious.

In this judge's view, this was not enough to dispel authorities
that made no distinction between bills to order and straight bills in respect of
the need for production of the original bill on delivery. The judge held that
the shipper who asks for issue of a straight bill of lading rather than a sea
waybill does so because he wants to keep some degree of control over delivery of
the goods. Once the owner issues a bill of lading, whether it is an order bill
or a straight bill, he must not deliver the cargo except against the production
of the original.

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